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The Business of Hockey Discuss the financial and business aspects of the NHL. Topics may include the CBA, work stoppages, broadcast contracts, franchise sales, and NHL revenues.

Keller: Sorry, Canada the NHL Just Got Stable

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Old
12-01-2013, 11:01 PM
  #26
htpwn
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Quote:
Originally Posted by Buck Aki Berg View Post
As a hockey fan, I have the same emotional response - I want hockey to be where it's watched, enjoyed, and appreciated, not where it's propped up by subsidies and complimentary products on off nights.

From an economic standpoint, it's certainly not a bad business plan. It's no different than how a grocery store sells staple products below cost to bring people in, knowing they'll come out ahead because these people will buy a dozen other things at a markup. If the operation comes out ahead, it's not bad business.
For the teams or the league?

We know that in places like Florida, ownership uses the NHL franchise as a lost leader. The team is tied to the lease, so while it losses money, ownership is happy because the events and concerts held at the arena generate a profit.

However, to my knowledge, that profit isn't counted in HRR. So, by the NHL's financials, the Panthers lose money. Whether the ownership group is making money is not important. It helps stabilize the franchise, it (combined with the lease) makes it unlikely the team will move, but it doesn't make the Panthers franchise any less of a drag on league revenues.

If the NHL had the option of moving the Panthers today, the lease pushed aside with no legal ramifications and emotions of the "we stand by our fans" stance dropped, I think they do. There's no economic benefit at this point to having a team in South Florida, but the status quo ensures that there will be.

This deal won't change those facts. The Panthers and Coyotes will continue to be an anchor around the NHL's neck. Their revenues haven't changed, their underlying economics haven't changed, only league revenues have. Since every team gets that benefit equally, I don't see how this will fix the problems plaguing them. Whatever benefit the extra money brings in, much of that will be eroded by a rising cap floor.

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Originally Posted by DaveG View Post
Can't disagree at all, though I'll point out a few devils advocate opinions on the bolded.

Had the Atlanta owners not been actively trying to ditch the team from the moment they bought the three entities (Thrashers, Hawks, Phillips) from Turner aren't the odds significantly in favor of the Jets still being the Thrashers? Same can be said with the Coyotes and Moyes, though the NHL at least had the ability to prevent that one from happening.


The CBA (especially the cap) also went a long way in allowing teams like Nashville and Carolina to become competitive and turn from teams that were hemorrhaging money and in turn become teams that are break-even or better as much as they are not of late?

But that said, the increase in the Canadian TV deal still means the mid and lower revenue teams need to keep up lest they financially not be able to play on a level playing field with 10+ million differential in payrolls. The money from expansions (Seattle and whichever of QC/Toronto2/Hamilton) in the next few years are only going to exacerbate that.
ASG and Moyes' lack of desire to own a franchise doesn't change the fact that each franchise was losing in excess of $10 million a year.

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Old
12-01-2013, 11:47 PM
  #27
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Jeez, is there ANY topic that the Canadian media can't interpret as a relocation issue?

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12-02-2013, 12:26 AM
  #28
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Originally Posted by tarheelhockey View Post
Jeez, is there ANY topic that the Canadian media can't interpret as a relocation issue?
Hit counts tarheel. Revenues. Google-Ads. Lord knows the news stands are dead.

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12-02-2013, 12:55 AM
  #29
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Nah. Still asymmetrical growth. And frankly, I don't think revenue sharing is indexed to growth anyway. Theoretically, depending on how disproportionate the share is that goes to Canadian teams out of this deal, it could make the medium-term prospects of Florida and Phoenix worse.

In 5 years, the Panthers and Coyotes are going to be in the same situation they were in 2011, unless they start putting butts in seats or relocate.

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12-02-2013, 04:54 AM
  #30
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The deal signals two new NHL teams in Canada: QC and TO2. Why do you think they are building new NHL-quality arenas in those locations?

http://www.forbes.com/sites/christin...eam-expansion/

Note: the above article is misleading on % split. More accurately: the money is shared equally after invasion fees are paid.

The Canadian teams will receive a larger % of the pie, due to invasion fees - $17 to $20 million per year per Canadian team.

The remainder to be divided amongst the US teams.

http://www.ottawasun.com/2013/11/26/...ttawa-senators

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12-02-2013, 07:59 AM
  #31
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Originally Posted by tarheelhockey View Post
Jeez, is there ANY topic that the Canadian media can't interpret as a relocation issue?
Jeez, why do you have a problem with what the Canadian media says?

You're in the states, worry about what ever story your media is discussing. Sure to hell, enough of them.

Hockey is kind of popular up here, (though there is room to grow the game) I guess I could say jeez, why does the NHL and some American media think the only place where the game can grow is in the US.

Most people here think at most Canada could support 3 more teams, that's it. Let's say 3 teams leave the states and are stolen by Canada (not going to happen-nor should it) simple math tells me that Canada would have 10 teams and the states 20 teams.

Another poster here tells us he doesn't think of country when talks of expansion happen and I agree with him. Lets just think where the money will flow in and that just happens to be in the place where some incorrectly think folks say aboot. Ya'no eh?

Just my rant, now off to watch Buffalo news and the latest house fires.

PS: As a Canadian I prefer to watch/read news about possible more NHL teams in Canada than house fires in Buffalo.

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12-02-2013, 08:27 AM
  #32
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So if I'm understanding this correctly..... The Jets would get approx. 20M from the new national deal.
Plus approx. 6M from the NBC deal. Plus whatever they are currently receiving from the TSN regional deal which goes on for another 7 years??

Please correct if I'm wrong.

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12-02-2013, 09:33 AM
  #33
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Yeah, don't see how this will make things any better for the teams in trouble.

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12-02-2013, 09:50 AM
  #34
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Quote:
Originally Posted by htpwn View Post
For the teams or the league?

We know that in places like Florida, ownership uses the NHL franchise as a lost leader. The team is tied to the lease, so while it losses money, ownership is happy because the events and concerts held at the arena generate a profit.

However, to my knowledge, that profit isn't counted in HRR. So, by the NHL's financials, the Panthers lose money. Whether the ownership group is making money is not important. It helps stabilize the franchise, it (combined with the lease) makes it unlikely the team will move, but it doesn't make the Panthers franchise any less of a drag on league revenues.

If the NHL had the option of moving the Panthers today, the lease pushed aside with no legal ramifications and emotions of the "we stand by our fans" stance dropped, I think they do. There's no economic benefit at this point to having a team in South Florida, but the status quo ensures that there will be.

This deal won't change those facts. The Panthers and Coyotes will continue to be an anchor around the NHL's neck. Their revenues haven't changed, their underlying economics haven't changed, only league revenues have. Since every team gets that benefit equally, I don't see how this will fix the problems plaguing them. Whatever benefit the extra money brings in, much of that will be eroded by a rising cap floor.



ASG and Moyes' lack of desire to own a franchise doesn't change the fact that each franchise was losing in excess of $10 million a year.
While that's true, isn't it possible that said lack of desire is the main reason behind the 10M a year loss? If you owned a restaurant that served nothing but leftovers, how successful do you think you might be?

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12-02-2013, 04:06 PM
  #35
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When teams get out of leases, they will look for the best opportunity to make money and not lose money. And those opportunities are up north these days, and possibly forever more. If I'm an owner in struggling Carolina and I get a windfall to sell my portion of the team to an owner who wishes to move it, I'm selling it. This is a business not a charity and the people who know this most are the owners.

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12-02-2013, 04:14 PM
  #36
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Quote:
Originally Posted by Tackla View Post
When teams get out of leases, they will look for the best opportunity to make money and not lose money. And those opportunities are up north these days, and possibly forever more. If I'm an owner in struggling Carolina and I get a windfall to sell my portion of the team to an owner who wishes to move it, I'm selling it. This is a business not a charity and the people who know this most are the owners.
But don't you understand! You have to grow the game! A team worth a billion dollars in Hamilton does nothing for that cause!

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12-02-2013, 04:17 PM
  #37
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Quote:
Originally Posted by Tackla View Post
When teams get out of leases, they will look for the best opportunity to make money and not lose money. And those opportunities are up north these days, and possibly forever more. If I'm an owner in struggling Carolina and I get a windfall to sell my portion of the team to an owner who wishes to move it, I'm selling it. This is a business not a charity and the people who know this most are the owners.
Did Peter Karmanos run over your dog over something? As DaveG said and I've REPEATEDLY said when you've brought this up...

Quote:
Canes have more then enough local investors into things now that it's not a worry even when he does retire from things.
Quote:
...it'd behoove you to go over to the BoH boards and read up on the local minority investment/ownership groups that Karmanos has brought on board to help tie the franchise to the area and his plans to relocate from Detroit to Raleigh permanently after he steps down from Compuware. But, y'know, easier to discuss nebulous rumblings than actual facts, I suppose.

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12-02-2013, 09:23 PM
  #38
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Did Peter Karmanos run over your dog over something? As DaveG said and I've REPEATEDLY said when you've brought this up...
Don't sweat it - he really wanted to say "Phoenix", but he knows he's not supposed to yet.

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12-03-2013, 12:41 AM
  #39
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I mentioned Carolina because it's the 27th most valuable team, a bottom-feeder franchise, and it was mentioned earlier in the thread. There are a number of other teams I could mention. None of these benefactors of revenue sharing are any more stable than they were before the newest Canadian TV deal was signed. When their leases end, these teams can very well be on the move and the NHL won't mind or intervene because it will have fulfilled the promise it co-signed and will be in the clear to relocate, unlike in the Phoenix situation that would've damaged the NHL's reputation if they relocated. But people will believe what they want to believe, like having owners that would take a loss just to keep their team in an apathetic market. Yeah right!

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12-03-2013, 12:48 AM
  #40
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Quote:
Originally Posted by Bongo View Post
While that's true, isn't it possible that said lack of desire is the main reason behind the 10M a year loss? If you owned a restaurant that served nothing but leftovers, how successful do you think you might be?
In Atlanta? Definitely played a role, far more complicated situation.

In Phoenix? I think that market's track record speaks for itself.

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12-03-2013, 02:11 AM
  #41
tarheelhockey
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Jeez, why do you have a problem with what the Canadian media says?

You're in the states, worry about what ever story your media is discussing. Sure to hell, enough of them.
Until my HF account gets closed I will continue to come to this page and worry about whatever is posted here. If the source of an article is a Canadian media entity, well, that makes me an interested party in the subject of Canadian media.

Sorry if that rustles your jimmies. This is the internet, not a hometown news stand. You don't get to tell people to go back to their own town.

Quote:
Originally Posted by Tackla View Post
I mentioned Carolina because it's the 27th most valuable team, a bottom-feeder franchise, and it was mentioned earlier in the thread. There are a number of other teams I could mention.
You've been going thread to thread lately and spontaneously claiming that the Hurricanes are a relocation candidate, in spite of being corrected several times and failing to provide any sources for your assertion. It's a noticeable pattern. What gives?

BTW, has it occurred to you that the smallest American market should be 27th in value? Their neighbors on the list are New York and St. Louis, for chrissake.

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12-03-2013, 02:19 AM
  #42
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Quote:
Originally Posted by tarheelhockey View Post
Until my HF account gets closed I will continue to come to this page and worry about whatever is posted here. If the source of an article is a Canadian media entity, well, that makes me an interested party in the subject of Canadian media.

Sorry if that rustles your jimmies. This is the internet, not a hometown news stand. You don't get to tell people to go back to their own town.



You've been going thread to thread lately and spontaneously claiming that the Hurricanes are a relocation candidate, in spite of being corrected several times and failing to provide any sources for your assertion. It's a noticeable pattern. What gives?

BTW, has it occurred to you that the smallest American market should be 27th in value? Their neighbors on the list are New York and St. Louis, for chrissake.
Looking back through his/her post history it seems any chance s/he can get to badmouth the Canes s/he takes. My money's on s/he being an old Whalers fan who can't let it go. As Fugu is wont to remind us around here, this is BoH, no room for personal feelings and I think Tackla's personal animus against Carolina, despite all contrary evidence provided by people who actually know the market falls counter to this. As many are quick to point out, it's just business, it ain't personal. Get over it and move on - stick to facts and figures, not baseless speculation.

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12-03-2013, 03:10 AM
  #43
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We seem to have drifted away from discussing the OP article.

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